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Upaid seeks deposition of Satyam executives

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CIOL Bureau
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LONDON, INDIA: British online and mobile payment services provider Upaid Systems announced on Thursday that it is filing a motion in Collin County, Texas district court requesting depositions of Satyam Computer Services' chairman, chief financial officer and global head of corporate governance.

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The motion is in connection with the alleged attempt on the part of Satyam earlier this week to strip all surplus cash from the company in a $1.6 billion related-party transaction benefiting the family of Satyam’s founder and chairman, said a press release.

Satyam is already facing suits in U.S. Federal and State Courts filed by Upaid claiming fraud, forgery and breach of contract, as a result of which Upaid has suffered damages to its business and prospects in excess of $1 billion.

The existing case against Satyam filed by Unpaid is for providing it forged documents which were used to get patents in USA.

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Satyam had told that it always did the right thing and will defend its innocence in court. The Federal Court proceeding is currently scheduled for a Texas jury trial in June of 2009, and Satyam is facing the potential of a very sizable judgment against it, the Unpaid release claimed.

At present, Satyam has cash resources to pay a $1 billion plus judgment or the liquidity to support a supersedeas bond, it added.

However, on December 16, 2008, Satyam announced a plan to strip $1.6 billion of cash out of the company, an amount that exceeds its cash, in a transaction to acquire Maytas Properties and Maytas Infra, whereby the large majority of this cash would go to the family of Satyam's Chairman, Ramalinga Raju.

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The Satyam executives whose depositions are being requested are Ramalinga Raju, (Chairman) Srivinas Valdamani (CFO) and G. Jayaraman, (Global Head - Corporate Governance).

The evidence of Satyam's poor corporate governance and business practices has been mounting, harming Upaid, other customers and now Satyam's shareholders, Unpaid alleged.

Satyam had called off the $1.6 billion deal to acquire Maytas Infra and Maytas Properties, owned by Raju’s son, following the opposition from investors.

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